Question

Write a 2,500 word paper explaining the role of the BAS agent—what a tax or BAS agent must do with regard to preparation and lodgement of BAS and IAS forms. (AUSTRALIAN TAX) Explain what GST is, how the BAS applies and why it is used. In the paper answer these questions: 1. What legislation needs to be complied with and what procedures need to be followed to comply with legislation, regulations and the Code of Professional Conduct? 2. What is a tax agent service? 3. What materials or sources will you use to review, interpret and apply legislation related to taxes reported on activity statements? 4. What reconciliation procedures will you follow? 5. How will you identify lodgement schedule requirements and ensure sufficient funds are available? 6. How will you process accounting data to comply with tax reporting requirements? 7. What payroll activities will be reported on and what reconciliation activities will be involved? 8. What forms will be required and how will the BAS and/or IAS be lodged?

Answer 1

Solutioon:

BAS Agent

A BAS agent is the tax agent who is registered to providing BAS services for fee and reward. BAS stands for Business Activity Statement that is submitted to the Australian Taxation Office (ATO) related to the tax liabilities and obligations of the taxpayer. BAS statements are submitted by the registered business entities regarding their tax obligations such that GST, FBT, PAYGW etc. A BAS agent acts as an intermediary between the ATO and taxpayers. He issued a license to the individuals or business organisations and represents the relation between clients and ATO regarding tax obligations. Despite this, an open and helpful role of a BAS agent is advising clients related to tax returns, concessions and payments.

Taxes that are concerned with the BAS Agent are:

• Goods and Services Tax (GST)
• FBT (Fringe Benefits Tax)
• Income Tax
• Payrolls that are related with the tax withholding
• PAYG withholding amounts

Preparation and Lodgment of BAS and IAS Forms: BAS Agent also deals with concession and payment when clients lodge, electronically eligible quarterly activity statements. Lodgment concession on payments for PAYG withholding summary reports and lodgment obligations are divided into quarters. A BAS lodgment form is submitted to the ATO by the BAS agent that determine tax obligations of taxpayer including concessions under lodging.

IAS forms are submitted by the taxpayers those would have to pay PAYG income tax. IAS stands for Installment Activity Statement. Some the options in BAS/IAS lodging forms are PAYG income tax installment, T5, total payment amount, lodging party signature date, validate or recalculate, payment methods, etc. Forms can be saved, printed and canceled.

Goods and Services Tax (GST): Refers to a tax that is imposed on goods and services that are selling under the country. Good and Services Tax is an indirect tax that is applicable on the supply of goods or services. BAS Agent can provide list of codes and tax liabilities to the clients. BAS provisions are helpful for GST collections and payments.

BAS Agents provide services according to their experience and license. He is not able to provide service which has not licensed to provide under the TASA code of conduct. A registered tax agent and a BAS agent would have followed professional and ethical standards or values under legislative code set previously. This code is known as Code of Professional Conduct that sets the required professional standards and values for a registered tax agent and BAS agent. The Code of Professional Conduct has fourteen principle divided into five categories namely honesty and integrity, independence, confidentiality, competence and other responsibilities.

Tax Agent Services are provided by the tax agents to their clients and the ATO. The services are related to notify liabilities, obligations of the clients, dealing with ATO, concession, claim, and payments. Tax Agents are providing their services under Tax Agent Services Act (TASA), 2009. When BAS agents providing their services require different kinds of materials. They can check book-keeping records, operate systems and implement procedures. So, the materials used by the BAS agent are pen, papers, books of accounts, computerised system, calculator, records and statements. After checking book-keeping records, he proceeds towards reconciliation of statements with tax liability of the clients. For this purpose, he would have to check profit and loss account entries and income statement and match terms with tax liability of the client. A BAS Agent can electronically lodge, in case of concessions and payments for PAYG withholding summary reports and lodgement obligations, there are some requirements for BAS agents regarding income tax, FBT and new registrants. For income tax, requirements are lodge returns electronically, and 85% or more clients of a BAS Agent will lodge on time (within current year). For FBT, requirements are lodge returns electronically and due date for concessions is 25^th June. BAS agent should have to encourage 85% or more clients to lodge. FBT returns liability due date is 28^th May, lodged on time in the current year. All the above conditions are also applied, in the case of new registrants that are registered as tax agents. Public and private ancillary funds are deductible under gifts category, so, it is necessary to lodge electronically within the time for deductions in returns.